Five signs you’re being scammed

Consumers are under a lot of financial strain. The World Economic Forum reports that the cost-of-living crisis is affecting people across the globe. With food and fuel prices rising, it’s becoming increasingly difficult to keep financially afloat. On top of that, salaries aren’t keeping up with inflation, making it more difficult to save and build wealth.

It’s during such times of economic difficulty and uncertainty that fraudsters lure unsuspecting consumers into “get-rich-quick” schemes, offering an avenue to make easy money by investing in a “lucrative” financial opportunity.

Nothing beats the prospect of making easy money, and every now and again there seems to be a “get-rich-quick” scheme circulating on WhatsApp or on social media that seems legitimate. But it’s not.

Our research interests centre on financial systems in emerging economies, and we advocate for financial inclusion and empowering marginalised communities through financial literacy and financial planning. We use our academic platform to share our expertise on finance, including common financial traps people should steer clear of.

Our mission is to share knowledge and inform decisions.

“Get-rich-quick” schemes are one such trap. They’re also sometimes called ponzi or pyramid schemes. The schemes are a form of financial fraud. The people running them take money through deception: the misrepresentation of information and identity. They promise financial benefits that don’t exist.

You should avoid them because, more often than not, they are bogus and fraudulent business ventures.

There have been some massive fraud schemes over the past 30 years. In the early 1990s, MMM Global – one of the world’s largest and most notorious ponzi schemes – defrauded up to 40 million people, who lost an estimated US$10 billion. Ponzi schemes have since resurfaced in different forms in South Africa, Nigeria, Zimbabwe, Kenya, Ghana and several other African countries.

There are five tell-tale signs of a “get-rich-quick” scheme. Watch out for them.

Continued next page

(36 VIEWS)